ACCC pursuing "significant penalty" from Volkswagen

Government body wants to "send a message", while Audi and Skoda escape attention for now.

ACCC pursuing "significant penalty" from Volkswagen

01 Sep 2016

Australia's consumer watchdog says it is "trying to achieve a significant penalty" in legal action against Volkswagen launched on Thursday.

ACCC chair Rod Sims says the government body wants to make an example of the embattled manufacturer following alleged breaches of consumer laws stemming from the international use of a computer-controlled emissions defeat devices in diesel-powered cars.

"What we're trying to achieve here is deterrence, a declaration about what was done here, we're trying to achieve a significant penalty, and we try and do that in the most focused way we can," Sims says.

"It's to send a message about what you can and can't do."

Volkswagen says it is reviewing claims made by the ACCC, and that the action does not provide "any practical benefit to consumers", as a recall for the emissions issue will be carried out soon.

Volkswagen says it did not use defeat devices in Australia.

The brand says it has not broken local laws.

Audi and Skoda, elements of the Volkswagen Group that use the same engines and software as popular VW models, have not been targeted by the ACCC's action.

Sims says he has not elected whether to pursue action against Volkswagen's sister brands.

"That's a separate decision," Sims says.

"Audi has a different corporate structure in Australia to Volkswagen, and we judged it was simpler to deal with the one company. What we do with Audi and Skoda is a decision that is yet to be made.

"We often focus our investigations to get them to court as quickly as we can, or to work out a solution to the problem as quickly as we can.

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"We've had numerous meetings with Volkswagen, it would have slowed us down... to have numerous meetings with Audi and Skoda. It's that simple."

The Australian Automotive Association has been outspoken in its criticism of Volkswagen recently. AAA chief executive Michael Bradley says the brand "is clearly guilty of breaching the trust" of Australian owners, and that local emissions laws need work.

"Volkswagen's actions underline how the Australian Government has neglected its responsibility to properly ensure compliance with vehicle design standards," he says.

"Current consideration of new emissions laws only heightens the need for Government to begin properly measuring what it seeks to manage."